OST-00-7513 / US-Ecuador All-Cargo / Answer of Arrow Air / June 27, 2000

OF ARROW AIR, INC.

Arrow Air, Inc. (Arrow) herein submits its answer to other parties who have submitted applications in this Docket for allocation of U.S. - Ecuador weekly all-cargo frequencies. l/

Atlas Air, Inc. (Atlas) has applied for the three available narrow-body frequencies, proposing a routing Miami to the coterminals Quito/Guyaquil, with a south bound stop in Bogota, Colombia. Atlas proposes to use B-747-200 aircraft. Since there are only three weekly frequencies available, and the B-747 would require two for each round trip,, Atlas proposes to operate one round trip flight in one week and two in the next. The problem with this idea is obvious. The Department certainly cannot grant authority to Atlas for this operation without first obtaining the definite assurances of the Ecuadorian government that such a service pattern would be acceptable.

The other problem with the Atlas proposal is the proposed south bound stop in Bogota. From Arrow's recent experience it is

1/ Arrow was served with copies of applications and supplements by Atlas Air, Inc., Gemini Air Cargo, Inc. and Evergreen International Airlines, Inc. and an initial application by Fine Air Services, Inc.

ANSWER OF ARROW AIR, INC. DOCKET OST-2000-7513

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anything but clear whether the Colombian government will approve one-way service into Bogota and whether it will allow flights stopping in Colombia to continue to points south of Colombia, especially on a one-way basis.

Evergreen International Airlines, Inc. (Evergreen) requests also requests the three available weekly frequencies and proposes to operate B-747 aircraft between Miami and the co-terminals Quito, Guyaquil, and Latacunga, Ecuador. In its supplemental filing Evergreen also proposes the same service pattern as that proposed by Atlas: alternating weeks of one and two wide-body round trips. It also relies on the "extra section" provision in the U.S.-Ecuador treaty to avoid wasting any of the three weekly narrow-body frequencies by using B-747 aircraft.

Gemini Air Cargo, Inc. (Gemini) proposes to operate two weekly round trips Miami-Quito/Guyaquil with DC-10-10F aircraft.

The primary problem with all three of the foregoing proposals is a lack of flexibility of more frequent service with narrow-body equipment. Operating widebody equipment only one, two, or three times per week throughout the year will result in inadequate service during the peak periods and extensive over-capacity in other periods. Arrow's experience in this market clearly indicates that more frequent narrow-body service is superior to less frequent wide body service.

Furthermore, in the proposals of Atlas and Gemini is the serious risk that frequencies will be wasted if the full and continuing acceptance of their proposals by the Ecuadorian government is not available on a continuing basis.

ANSWER OF ARROW AIR, INC. DOCKET OST-2000-7513

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Of all the proposals submitted in this proceeding, Arrow's service proposal offers the most frequent and flexible pattern in this important market.

Respectfully submitted,

Allan W. Markham

ALLAN W. MARKHAM, PC

Counsel for ARROW AIR, INC.